Thursday, March 16, 2006

It appears that United States companies are much farther up the learning
curve .... Professors Bloom, Sadun and Van Reenen looked at 7,500 establishments
in Britain and found that in terms of value added per worker, American
multinational corporations were 23 percent more productive than the average in
Britain. ...

He cites differences in the use of information technology as a major factor
in the productivity differences. Perhaps there's another reason as well:

London School of Economics/McKinsey study says the
best way to ruin a UK family business is to give it to an eldest son, by Finfacts Team:
Research published today by the Centre for Economics Performance at the London
School of Economics and McKinsey the consultancy, suggests that the best way to
ruin a UK family business is to give it to an eldest son. The research into the gap between the UK's
productivity performance and that in the US, France and Germany found ... that half of the difference between British
companies and their overseas competitors ... could
be explained by the prevalence in Britain of second or later generation
family-run companies. If those were removed from the analysis, British
performance did not look nearly so bad.

Nick Bloom, one of the authors, urges the UK
Government to scrap the 100 per cent inheritance tax relief given to large
family businesses. Bloom says that if tax relief were to be capped
at £1m, it would spur productivity growth, save taxpayers £250m a year and avoid
entrenching poor management in Britain's boardrooms. "Can you imagine if the
current England football team was picked from the sons of the team in 1966? We
wouldn't win anything."...

Family firms exist across the world
so why single out the UK? From our survey of manufacturing, it turns out that
the UK has a high number of firms that are both family-owned and family-managed.
The ... number of family-owned firms is about 30% in the UK, France and Germany
and 10% in the United States. ... the majority are managed by the family in the UK and
France, but not in Germany. Moreover, ... about half of all
these family firms in the UK reported handing down CEO control by primogeniture
– that is, to the eldest son.

It appears that United States companies are much farther up the learning
curve .... Professors Bloom, Sadun and Van Reenen looked at 7,500 establishments
in Britain and found that in terms of value added per worker, American
multinational corporations were 23 percent more productive than the average in
Britain. ...

He cites differences in the use of information technology as a major factor
in the productivity differences. Perhaps there's another reason as well:

London School of Economics/McKinsey study says the
best way to ruin a UK family business is to give it to an eldest son, by Finfacts Team:
Research published today by the Centre for Economics Performance at the London
School of Economics and McKinsey the consultancy, suggests that the best way to
ruin a UK family business is to give it to an eldest son. The research into the gap between the UK's
productivity performance and that in the US, France and Germany found ... that half of the difference between British
companies and their overseas competitors ... could
be explained by the prevalence in Britain of second or later generation
family-run companies. If those were removed from the analysis, British
performance did not look nearly so bad.

Nick Bloom, one of the authors, urges the UK
Government to scrap the 100 per cent inheritance tax relief given to large
family businesses. Bloom says that if tax relief were to be capped
at £1m, it would spur productivity growth, save taxpayers £250m a year and avoid
entrenching poor management in Britain's boardrooms. "Can you imagine if the
current England football team was picked from the sons of the team in 1966? We
wouldn't win anything."...

Family firms exist across the world
so why single out the UK? From our survey of manufacturing, it turns out that
the UK has a high number of firms that are both family-owned and family-managed.
The ... number of family-owned firms is about 30% in the UK, France and Germany
and 10% in the United States. ... the majority are managed by the family in the UK and
France, but not in Germany. Moreover, ... about half of all
these family firms in the UK reported handing down CEO control by primogeniture
– that is, to the eldest son.